Budget 2024 commits $5B for Indigenous loan guarantees, but falls short on infrastructure

The federal government is providing up to $5 billion in loan guarantees to help Indigenous communities invest in natural resource and energy products.

But when it comes to a promise to close what advocates say is a sprawling Indigenous infrastructure gap, Ottawa is short more than $420 billion.

Teased in last year’s fall economic statement, the Indigenous loan guarantee in the 2024 budget allows communities to decide which projects to invest in.

The loans would be guaranteed by the federal government, ensuring Indigenous borrowers can get more favourable interest rates.

First Nations business leaders have long called for an Indigenous loan program to allow for investments in oil and gas projects.

The First Nations Major Projects Coalition anticipates Indigenous participation in the natural resource and energy sector could reach $525 billion in capital investments over the next 10 years.

As much as $50 billion more could be needed for Indigenous equity financing, the coalition projects.

But the federal Indian Act doesn’t allow First Nations to put up their land or other assets as collateral, making financing harder to secure.

“If Canada is to make sure that Indigenous communities are able to fully benefit from the opportunities ahead, they need fair access to affordable capital that meets their unique needs,” the document says.

Last year, Ottawa committed to lending affordable capital to Indigenous communities through the Canada Infrastructure Bank to help them purchase equity stakes in infrastructure projects in which the bank is also investing.

But the infrastructure bank is only mandated to invest in projects that advance initiatives like clean power, green infrastructure, broadband technology and transportation.

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